Category Archives: Korea

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CoinUp CEO Gets 16 Years in Prison after Exchange Ponzi Exposé

South Korean-based cryptocurrency exchange CoinUp has been exposed as a Ponzi scheme. Its CEO Kang-mo has been sentenced to 16 years in prison for his role in defrauding investors of KRW 450 billion equivalent to USD 384 million.

Apparently CoinUp executives promised investors guaranteed gains of up to 200% in just 4 to 10 weeks, when in fact, the crypto investments offered were actually fake cryptocurrencies. In order to gain the confidence of investors, there was a photoshopped magazine of Kang-mo standing next to South Korean President Moon Jae-in in the CoinUp office.

Further, evidence indicates that CoinUp paid early investors with deposits from later investors. This is the structure of a classic pyramid — also known as a Ponzi — scheme and causes early investors to think CoinUp is trustworthy, which causes early investors to tell their friends and family which lures in even more investments.

CoinUp’s CFOs Kwon and Shinmo were also sentenced to 11 years in prison, with CoinUp’s ‘governor’, Yunmo, and his mother-in-law receiving seven years in prison. Other CoinUp executives received sentences between six and nine years. is committed to unbiased news and upholding journalistic codes of ethics. For more information please read our Editorial Policy here.

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Korean Exchange Bithumb Loses $31M in Hack, Halts All Withdrawals

Bithumb announced on 20 June 2018 that it was hacked overnight, resulting in the loss of KRW 35 billion (USD 31 million) of cryptocurrency. For the time being, all cryptocurrency and fiat withdrawals are frozen, and Bithumb urges customers not to deposit any cryptocurrency since all of Bithumb’s digital assets have been moved into cold storage for safety. Bithumb says that it will cover the losses from its own money so customers don’t have to worry, and the exchange will re-open after a process of security review and enhancement.

Bithumb is the biggest cryptocurrency exchange in Korea with daily trading volume near USD 400 million, making it the 6th largest in the world behind Binance, OKEx, Huobi, Bitfinex, and Upbit. A total of 37 different cryptocurrencies are traded on Bithumb, so depending on which coins were stolen, it might take some time for the exchange to re-acquire customer’s cryptocurrency.

This is the second time in June 2018 that a South Korean cryptocurrency exchange has been hacked. A little over a week ago on 11 June, Coinrail was hacked, losing USD 40 million of cryptocurrency. Coinrail is a much smaller exchange than Bithumb and was ranked only 90th in the world with daily trading volume of USD 2 million, so the hack was too much for the exchange to handle and it remains disabled as of this writing. The Coinrail hack was blamed by many as the impetus for a 10% decline in Bitcoin’s price on the same day.

The news of the Bithumb hack is breaking as of this writing so market impact remains to be seen, but already Bitfinex has dropped by over USD 100, roughly a 1.5% price move. Bad news like a major cryptocurrency exchange being hacked has been known to cause steep negative movements in the Bitcoin market in the past, so the drop probably isn’t over.

It was reported earlier in 2018 that long-time feuding neighbor North Korea has been actively hacking cryptocurrency users and exchanges in South Korea as a means to obtain cryptocurrency so that they can circumvent international sanctions. No doubt there will be some speculation that North Korea might be the reason two South Korean cryptocurrency exchanges have been hacked in such rapid succession this month.


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Asia Pacific: Crypto and Blockchain News Roundup, 27th March to 5th April 2018

Asia Pacific

Welcome to our weekly roundup of all important blockchain and cryptocurrency news from around the world. Follow the latest developments in the cryptocurrency space continent by continent, country by country.


14% of Japan’s young male workforce invest in cryptocurrencies: According to a recent study by Shin R25, more than 14% of Japan’s young male employees in the age bracket of 25-30 regularly invest in cryptocurrencies. Out of these young enthusiasts, 92% got into it because it was a good investment while 37.4%invested because it was a “trend” and around 20% said they got into it because of media and investor acquaintances. Regarding future investment, around 45% were of the opinion that they would invest again in the future while 35% didn’t want to invest again because of sharply declining prices in the near-term. Japan continues to be a strong hub of investment in cryptocurrencies particularly Asian origin NEO and NEM coins.

Japan’s central bank encourages people to “try” cryptocurrencies: In a bold move, Japan’s central bank’s financial services information head Masashi in a Q&A summary called Lets think about cryptocurrencies” has called for the public to at least try cryptocurrencies in the future.

The official statement said: “To that end, it is important to actually try it in the world. There is reason to believe that [its maturity] will allow us to use existing cryptocurrencies, accumulate use cases and promote further technical development.”.

Japanese online broker bids for cryptocurrency exchange: Japanese cryptocurrency broker Monex is considering buying CoinCheck, a cryptocurrency exchange that suffered a high-profile hack back in January according to recent reports. Bitcoin’s price index actually experienced a significant increase in the following days following this positive news from the Land of the Rising Sun and rose above USD 7,400 after the news was aired as it would have given the embattled exchange another lifeline.

Chinese national arrested for cryptocurrency fraud: Japanese police revealed last Tuesday that they had arrested a Chinese citizen from Tokyo after the said person was caught selling client accounts in cryptocurrency exchanges that he had opened to a gang of criminals. The man, named by reports as Lin Xiaolin, had been living in Tokyo for a while. He has so far denied these allegations and could be trialled later on. When the cryptocurrency boom was at its peak, many cryptocurrency exchanges closed their doors to new investors because of scalability and security issues. Because of the demand, it was somewhat common to see people looking to buy existing cryptocurrency exchange accounts that were sitting idle or with negligible activity.

South Korea

Seoul to launch its own cryptocurrency: News from Seoul, the capital of South Korea, has confirmed earlier reports that the city administration is aiming to launch its own cryptocurrency called the S-Coin. The coin will be used for social benefits programs according to the mayor Park Won-soon and it will launch soon according to an interview with Coindesk Korea.

Won-Soon said: “As Seoul is the world’s leading city in the field of information and communications, including the Fourth Industrial Revolution, I think we should study new technologies such as blockchains.”.

Blockchain technology will potentially be used for a wide range of government administrative processes in South Korea.

Cryptocurrency exchanges promise market cleanup: Cryptocurrency exchanges operating from South Korea have called for a “healthier” market trend. The exchanges Gopax, Coinone and Korbit, one of the biggest in the country collectively declared this during the Deconomy conference in Seoul last Tuesday.

Exchange executives in lockup in embezzlement probe: South Korean authorities on cyber crime have arrested four executives from two cryptocurrency exchanges CoinNest and and another unnamed one on charges of embezzlement of customer funds.

According to a Reuters report, the prosecutors’ office alleged: “They are being questioned about the embezzlement of billions of won (tens of millions of dollars) from their clients’ accounts and transferring it to their own”.


Crypto mining company posing threat to AMD and Nvidia: Cryptocurrency Mining hardware is going to face increased competition in the future as US chipmakers AMD and Nvidia will be tested by Chinese hardware company Bitmain Technologies Ltd based in Beijing. The Chinese company just started sales of its powerful Ethereum mining hardware and will look to build on that and challenge the hegemony of AMD and Nvidia in GPU mining.

China likely to follow global cryptocurrency regulations: China will likely support a consensus-based global cryptocurrency regulatory framework according to a recent insight by the People’s Bank of China (PBOC). The move comes after recent investments in blockchain technology by the Chinese government and impending release of the first government-backed cryptocurrency in the country.

China’s government cryptocurrency gathering momentum: A group of Shanghai reporters got a rare look inside the secret project by the Chinese government to introduce a new state-backed cryptocurrency in the market. The reporters were allowed access into Bank of China Credit Card Development Ltd in Hanghzhou. However, the bank also doubled down on not recognizing other cryptocurrencies including Bitcoin or Ethereum.


Cryptocurrency purchases banned: Reserve Bank of India has banned cryptocurrency purchases from local fiat bank accounts according to latest sweeping measure in the South Asia country.

According to an RBI statement:

“Reserve Bank has repeatedly cautioned users, holders and traders of virtual currencies, including Bitcoins, regarding various risks associated in dealing with such virtual currencies. In view of the associated risks, it has been decided that, with immediate effect, entities regulated by RBI shall not deal with or provide services to any individual or business entities dealing with or settling VCs. Regulated entities which already provide such services shall exit the relationship within a specified time.”


Malaysian airlines open to cryptocurrencies: According to news from The Sun Daily, Malaysian Airlines is open to new digital initiatives to enhance customer experience and would be open to a cryptocurrency payment option.


New crypto exchange regulation enforced: Effective from 3 April, the Australian government has levied new Anti-Money-Laundering (AML) rules for cryptocurrency exchanges, according to confirmed reports from the Australian government. The move comes after a sharp rise in cryptocurrency related scams in the region. Failure to abide by these new regulations will risk appropriate punishment from the courts but a six-month grace period is also given to the exchanges to catch up to these new rules.


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